Analysis of five hot words in LED industry in July

In 2013 July the LED industry, remarkable deplorable events too much, driven in the industry consolidation, either in the upstream or downstream application chip packaging enterprises, enterprises have already started the acquisition of the whole enterprise make snap and plan. Every change is a new life, every new year will inevitably leave footprints in this industry, and they will be concentrated into the industry's hot words.

Hot one: closures

At the beginning of July, Shenzhen billion light technology company was broke because of the debt, the boss run away detainees, collapse of the company. As an annual turnover of less than one hundred million yuan of small and medium sized display companies, trapped in the triangle debt, no surprise. At present, the display market as a whole is saturated, the industry has developed smoothly, low profits, increased business risk. In particular, small and medium sized display companies, for its customers and suppliers have no obvious bargaining advantage. Therefore, if the company fails to timely payment of money, it is easy to produce capital flow fracture risk, business failures inevitable.

At the same time, Zhongshan Xiong LED lighting factory was broke because of debt problems, the company is difficult to operate, the boss has run. For people who are in the Zhongshan market, the main low-end low-end products, its LED bulb bulb has reached a minimum of 1 yuan / watt, fully reflects the vicious competition in the market price of Zhongshan. However, enterprises in the pursuit of the lowest price at the same time, the quality of the product is difficult to guarantee, corporate profits will be minimal. If the product quality problems, it is difficult to recover the purchase price, when faced with a huge amount of outstanding loans, low profits, as well as large suppliers of goods, companies can only make ends meet, unsustainable.

Did not think of is not long after Ho (epitaxial epitaxial Zhongshan Guzhen Lighting Factory) boss Lee also run away, for Shihao epitaxy mainly by Jerry means to deceive customers. Although the LED lamp profits are diluted, but the Hao epitaxial through the sale of fake and shoddy products, LED light sales profits of up to 30 - 40%%, customer requirements 1W beads, the deceived customers to the 0.5W. Disturb the market order, such as the phenomenon of not only a small business, many companies blind pursuit of short-term interests, to low-end products into a price war of small businesses, wounding, but also hurt themselves.

For the mainland we have not run away, but last month that Innolux group LED grain factory Qili photoelectric will dissolve. It is reported that Qili photoelectric suffered low order wafer product competition pressure and the pressure of debt market China. LED industry has brought considerable pressure of pile up in excess of requirement for product prices, supply and demand imbalance also affects the reforming trend of the supply chain in recent years, signs of cross-strait LED industry in 2013 to enter the second wave of reshuffle game.

Hot two: industrial chain integration

With the rapid development of the industry, industry competition, industry consolidation continued to deepen. 2013, the industry has entered a critical period of integration, inter enterprise collaboration model requires the vertical and horizontal cooperation in the industrial chain. 2012 upstream production capacity of structural overcapacity, competition, mergers and acquisitions to a certain extent, reduce duplication of investment, reduce the vicious price competition, enhance the overall ability to resist risks. On the other hand, the outbreak of the lighting market is expected, many companies choose to complete the production capacity through mergers and acquisitions, channels, patents, talent and market resources integration.

An optoelectronic July 18th released a major contract announcement said, Shenzhen Siu chi to the light emitting diode chip of Anhui Sanan purchase amount of 500 million yuan. 500 million of the purchase amount, accounting for about LED of the company's 2012 operating income of. In July 17th, REFOND also announced that the company and TCL, canyuan (Yuxing company) set up a joint venture company, that TCL provides backlight and LED lighting device. Joint venture company registered capital of 200 million yuan, of which the company intends to own monetary funds invested $50 million, accounting for 25% of the registered capital of the joint venture company.

The industry chain in the strong positive layout, the industry is weak in the process of trying to force the interpretation of the strong constant strong story. Currently LED industry chain, especially the downstream lighting market competition pattern is very scattered, the size of the large and small enterprises flooded the market. While relatively strong upstream, internal integration has been basically completed. International experience, the vertical integration of the industry chain is an inevitable trend, from upstream to downstream product extension is the first choice for mergers and acquisitions.

The future of the industry will be more and more integrated development to the whole industry chain, downstream of the lighting market despite fierce competition but the market space is also very large, the military is a hotly contested spot. General lighting market is a large market capacity and smart phone market, the next 2-3 years LED lighting will be completed from 15% to 60% penetration. In fact, many companies are already in the layout. Such as Ruifeng in the consolidation of the backlight business, is quickly cut into the lighting market, especially in the field of active distribution of automotive lights. From the international experience, automotive lighting is the best profit margins in all areas of LED.

Hot three: breakout

In the context of the rapid development of the current LED industry, the international industry giants are quietly applying for a large number of core technology patents, and set up a very tight patent network, as a competitive weight. In the face of foreign patents encirclement and suppression, the city of Dongguan yesterday set up a patent alliance LED, the pattern of enterprises Baotuan attempt to break out, and actively respond to the risk of overseas intellectual property. It is understood that the alliance will establish a database of LED patents and patent navigation systems, while providing litigation and litigation services for enterprises.

In fact, from the first half of this year, have higher growth strength of demand for LED lighting has been over the past few years during the same period, and the market is still more optimistic about the second half of the demand will be enlarged, but even a significant increase in demand, as product prices continued to decline, the industry still faces profit difficult situation, so the product line to break out of the lighting industry, in addition to expand the scope of services, but also to ensure the gross profit and profit performance, including Edison to expand LDMS business model, while the international giant PHILPS is the development of higher order lighting solutions.

Beijing Cheng Xu Guoping, director of Au Optronics Co, said that through the intelligent control system to achieve two energy-saving. Lighting system for a venue, for example, there is no need to require the brightness of each lamp is the same, we should be the ultimate pursuit of the overall effect of lighting, including the contrast of light irradiation, etc.. Specifically, close to the window because of the natural light, the light can be a little dark, and some light away from the window, you need to light a little.

Shenzhen Chau Ming Polytron Technologies Inc is doing some similar attempts. In the beginning of 2013, their products on the Taobao's flagship store Tmall, began to test the water electricity supplier sales. Chau Ming brand director Mei Zhimin revealed that its Tmall store since January 4th this year on the line, in January sales reached 70 thousand yuan, in February reached $90 thousand, while in March soared to $about 300000. He said the next continent in Jingdong and suning.com and other platforms will also be on-line shop. Adequate flow on the line to help us nurture their own line of channels to further open the civilian market. "

Hot four: financial opium

Li Xinghua, director of the Guangdong provincial science and Technology Department checked, the people around the news, many LED companies. Li Xinghua's relationship with the LED industry is so close that people have speculated about how big the industry shock will be. And in May of this year, the Guangzhou Municipal Bureau of letters and other cadres were taken away discipline inspection departments. In fact, due to the power of industrial subsidies and funding for scientific research, science and technology information system has become a high incidence of corruption. The close relationship between the system and the enterprise has become the focus of attention.

At the same time, with the breeding of corruption and various types of fraud chaos. Audit report shows that in Anhui Province Energy Investment Co., Ltd. high-power LED green lighting project through false reporting data, defrauding the central government's energy saving key projects investment subsidy funds 9 million 900 thousand yuan. In addition, Guangdong snow Wright photoelectric Polytron Technologies Inc lied to compensate 3 million 455 thousand yuan, Guangdong Province, 100 percent Technology Co., Ltd. cheated to fill up to $232 thousand.

These policies will undoubtedly play a positive role in promoting the development of LED industry. In order to compete for this special funds and access to the government's LED project, companies have been in a number of places where the sun can not do everything.

The Zhongshan LED enterprise sales person in charge said bluntly, can get government subsidies or projects, hard power and soft power have, hard power refers to the enterprise itself is excellent technology, soft strength test business connections and government resources.

This kind of subsidies behind the white is two things: power and money, can also have these two things can get the government's favor. Of course, there will be some assessment criteria, but in the case of all enterprises are satisfied, than who is more like the government. He said, to apply for subsidies, the first step is to take charge of the person in charge of the first docking.

Hot Five: small spacing LED

Due to the introduction of LED 1.2mm the minimum distance between the global display of new products, Riyadh near day continuous rise. With the price of Riyadh successive record highs, the market for LED display attention also began to ascend.

Compared with the traditional LCD panel, the LED panel has a wider color gamut, a higher contrast and a better viewing angle, and is suitable for outdoor large-scale government and commercial purposes. Wei Chong shares for outdoor wall leading enterprises, domestic market share first, third in the world, the company main products are DLP, LCD type wall, the beginning of 2013 also launched a small pitch LED display 2.4mm and 1.9mm.

In the past, due to the lower barriers to competition led display, most companies have fallen into the stage of gross margin decline, the market's attention and valuation of the industry are lower. But LED display export growth in domestic sales growth, the global LED display market size of $13 billion 700 million this year, is about 2 times more than the domestic market, the domestic enterprise product price is high, still have room for growth in the export market. Lehman photoelectric exports accounted for 51% of the growth of overseas markets with greater flexibility.